1. For an item with high profit impact and low supply risk, what would be a likely procurement strategy to support the overall supply strategy?

A) Ensure supply, even at a premium cost.
B) Vertically integrate the supply chain.
C) Exploit purchasing power and minimize cost.
D) Form a strategic sourcing group.



2. Which of the following factors typically is most important to a company that uses the chase production strategy when evaluating potential suppliers for a component?

A) Supplier×?â?¬â?¢s agility
B) Supplier×?â?¬â?¢s certification status
C) Quoted delivery time
D) Quoted total price



3. Using financial tools to minimize the impact of currency fluctuations is an example of what type of risk management strategy?

A) Mitigation
B) Recovery
C) Prevention
D) Diversification



4. Production of a company's highest profit items is dependent upon the purchase of high-quality circuit boards. Which level of collaboration should the company develop with their supplier?

A) Pull replenishment
B) Strategic partnership
C) Revenue sharing
D) Vendor-managed inventory (VMI)



5. A company has a single manufacturing facility. It distributes the products through retail stores located in various regions. Which of the following distribution strategies will minimize the company's warehousing costs?

A) Utilizing third-party logistics (3PL) providers
B) Pooling inventory in regional warehouses shipping to multiple retail
C) Shipping directly from the manufacturing facility to retail locations
D) Cross-docking at regional warehouses shipping to multiple retail stores